Report details continued problems with Nevada's bifurcated unemployment system, hurdles to appealing PUA denials

Nevada should do away with its two-part unemployment claims system that has been bouncing applicants from one program to the other, and the state continues to create due process concerns because of delays in the ability of claimants to appeal a denial, according to a court-appointed special master.

The observations come in a 144-page follow-up report prepared by Reno attorney Jason Guinasso as part of a court case filed by unemployment claimants who have suffered delays in getting payments.

A Thursday morning hearing in the two-month-old case was the latest in a multi-front effort to dislodge payments from the clogged system, and comes after lawmakers took a stab at the problem during a special session and Gov. Steve Sisolak created a new “strike force” to work on the issue.

“Clearly, there is substantial focus, significant resources, and spirited efforts being made by the State of Nevada to resolve the problems with Nevada’s unemployment benefit delivery system,” the report says. “Unfortunately for many claimants, the progress being made is too late or otherwise not enough as they continue to suffer under the strain of not being employed and the desperation that comes from not being able to access benefits to sustain them and their families through the aftermath of the global pandemic.”

At the Thursday hearing, Washoe County Judge Barry Breslow modified a previous order, formally denying some requests for mass and immediate payments as a way to provide legal clarity as plaintiffs pursue relief before the Nevada Supreme Court. The lower court still retains jurisdiction to enforce a previous order, which called on the state to pay out three, more targeted groups of claimants.

The court date was largely a check-in on how the Nevada Department of Employment, Training and Rehabilitation (DETR) is doing meeting the prior court order. The state reported no claimants are being held up because they simply had a reduction rather than a complete cessation of gig work, unless their restarted work is bringing in wages that are too high to keep them eligible for benefits.

Of nearly 31,000 claimants who had previously been getting payments and saw them stop, DETR reported that 7,407 had been stopped for the legitimate reason that claimants started making too much money to qualify. Of the remaining 23,240 claims, DETR reported 3,500 were cleared of fraud-related flags and authorized for restarted payments.

But plaintiff attorney Mark Thierman said that number was unacceptably low, and the report was missing key information, such as the status of nearly 20,000 claims that were not cleared of fraud.

"This is a data dump, where all the missing pieces would give you a better handle on whether or not they're complying,” he said.

He also argued that the state was going in the wrong direction on addressing a backlog of Pandemic Unemployment Assistance (PUA) program claims for gig workers and self-employed people.

As of Tuesday, 243,963 claims remained unpaid out of more than 410,000 initial claims filed. That’s up from 139,107 unpaid claims in early July, although there have been more than 124,000 new initial PUA claims that have rolled in during that period.

"We're going downhill,” Thierman said. “I can't understand why we're saying we're doing such a great job. We're losing ground."

Of those unpaid claims, 186,826, or 77 percent, are flagged for a possible fraud issue, and most of the remaining claims are flagged for eligibility in another program such as traditional state-paid unemployment.

Guinasso’s report notes that some 79,000 people have been denied for PUA, although only about 7,800 are appealing that decision. Those statistics raise questions about whether claimants truly had an opportunity to appeal — the report says a link to do so works only intermittently — and whether help is coming too slowly because formal appeals hearings aren’t expected to begin until the latter half of September.

It also goes into painstaking detail about the trials individual claimants have had trying to navigate a glitchy web portal launched three months ago to field the crush of PUA claims. It lays out 41 unique issues claimants have run into — problems categorized by the crowd-sourced, detective-like work of large Facebook groups made of PUA claimants, who try to decipher cryptic messaging sent to them about their claim holdups with limited access to knowledgeable staff.

Guinasso’s report even recommends the new unemployment strike force led by former Nevada Assembly Speaker Barbara Buckley enlist the help of PUA Facebook group administrator Amber Hansen, whose findings inform a large chunk of the report. Group members have coordinated with people from out of state and personally contacted developers of the PUA portal to try to get answers in the absence of clarity from DETR.

“Ms. Hansen observed that claimants and DETR [Employment Security Division] appear to be speaking two different languages and are often weeks apart in what is occurring on the portal/claimant end versus what DETR understands and reports during press briefings,” Guinasso’s report said.

The Thursday hearing comes after Guinasso prepared a lengthy earlier report in July on the backlogged claims. Breslow in July ordered DETR to pay certain groups of claims by specific deadlines, but stopped short of declaring the agency to be in contempt of court.

Guinasso noted that DETR and plaintiffs represented by Thierman have failed to reach an agreement about how and when claimants should be paid, and Thierman has appealed to the Nevada Supreme Court.

Within the report, Thierman issued scathing responses to DETR’s statements of its progress.

“It is obvious that DETR is still arrogantly acting like it knows best, rather than listening to the orders of the Court,” the plaintiffs’ attorney writes at one point. “DETR employees may know technically more than the Court, but in our society, DETR employees must obey the Court, even if the Court is wrong, unless they get the Court to change its order.”

Thierman said the lack of explanation about why certain claims remain unpaid was so egregious that if DETR were a person and not an organization, he would ask for a perjury conviction. But Greg Ott, a lawyer within the attorney general’s office who represents DETR, said the criticism toward staff was making it harder to recruit and retain much-needed manpower.

“There are staff pressures. People are resigning because they can't deal with the stress,” Ott said during the hearing. “The tenor of opposing counsel, asking for perjury charges and ascribing improper motives to these people, is, I think, uncalled for."

The Nevada Independent is a 501(c)3 nonprofit news organization. The following people or entities mentioned in this article are financial supporters of our work:Jason Guinasso - $2,000.00; and Mark Thierman - $180.00.